Gold Bullion, Jewelry, and the Monetary and Non-Monetary Uses of Gold

A reader asked to what extent gold jewelry can be considered money. A second reader wants to know the implications of the crisis theory developed in my posts for the so-called transformation problem—the transformation of values into prices of production as a result of the equalization of the rate of profit.

Both are excellent questions, and they point to the method behind these posts.

When I first conceived the “Project” back in the 1970s, I imagined that I would write up a section on the nature of the law of value, surplus value, money and prices, and competition, and then finish it with a section on crises. Hadn’t that been Marx’s plan?

Well it proved too much for even Marx!

In fact, the basic work on value, surplus value and its division into profit (interest plus profit of enterprise) and rent, money and prices had, after all, been done by Marx. Marx based himself on his predecessors, the bourgeois classical political economists, especially David Ricardo. Therefore, the basic work of criticizing bourgeois political economy was already accomplished.

In order to cut the “Project” down to size, I assumed that readers would already have mastered Marx’s critique of political economy. (1) Not only do we have the work of Marx, but we have many popularizations of that work, though in the nature of things some of these popularizations are better than others.

Many popularizations of Marx’s economic theory go astray when dealing with some of the more subtle areas of value theory. It is here that the popularizers’ often incomplete understanding of value theory shows itself. This is especially true when they attempt to explain the nature of money and prices under today’s paper money system. (2)

Therefore, for those who want to pursue the study of the global capitalist economy, including its industrial cycles and crises, there is no real alternative but to sooner or later read Marx himself. And not simply read him once or twice, or accept things as true because Marx said they were true, but to understand why the economic laws discovered by Marx and his predecessors must be true and would be just as true even if Marx had never lived.

In these posts, however, I know the assumption that readers already have a solid grasp of Marx’s critique of political economy is not realistic, especially after decades of political reaction and retreat by the workers’ movement.

So to fully understand these posts, a basic grasp of value theory is necessary. However, those readers who do not have this solid grounding in Marx’s value theory, or even have little knowledge of economics of any kind, should not be discouraged. I have included a great deal of historical material in these posts that can be understood by readers with little or even no knowledge of Marxist economics in general or Marx’s value theory in particular.

But if readers with no knowledge of Marx’s value theory—or those with a limited knowledge—can return to these posts after acquiring a greater knowledge of Marxist economic theory in general and value theory in particular, I believe they will be able to read them in a whole new light. (3) A full understanding of both the causes and nature of capitalist crisis, and even more importantly the possibilities and limits of winning reforms under capitalism, is impossible without a deep understanding of the whole question of value.

In this reply, I will deal with the relationship between gold’s role as money and its role as a raw material in the production of jewelry. After this, I will deal with the theory of money that I used in my examination of capitalist crises and its implications for the transformation problem. Both of these topics are rather “advanced” topics in economics.

Therefore, this reply and the one week after next will deal with some of the more difficult questions of economics. The views expressed below are of course my own, and knowledgeable readers are free to offer their own criticisms and insights.

The monetary versus non-monetary use values of gold

To answer the question regarding the role gold plays as raw material in jewelry and its relationship to gold’s role as money material, we first have to review the role of gold as money material and the nature of money in general.

Perhaps others have dealt in some detail on the relationship between the monetary and non-monetary use values of gold on a Marxist basis. But if this is so, I don’t know of any such work. Below are some of my thoughts on this interesting question. This is certainly not the last word on this subject.

Gold and its various use values

I have already explained that Marx in dealing with the question of reproduction in Volume II of “Capital” was well aware that gold not only functions as the money commodity but has non-monetary use values as well. In developing his famous reproduction diagrams found in Volume II of “Capital,” Marx explained that gold bullion when it does not function as money material functions as raw material. This is why in his reproduction diagrams Marx put the production of gold bullion in Department I, the department of production that produces the means of production—which includes both raw and auxiliary materials.

Gold and simple reproduction

In developing his diagram of simple reproduction, which forms the foundation of expanded reproduction, Marx assumed that currency—what we might call the monetary system—consists entirely of full-weight gold coins. He further assumed that a certain quantity of these coins, through wear and tear they experience in circulation, fall below standard weight in the course of a year—or whatever the reproduction period is assumed to be. (4) Therefore, the industrial capitalists who mine and refine gold must produce enough gold bullion to replace those coins plus the quantity of gold that needs replacement in its various non-monetary uses.

Suppose X amount of gold coins are needed for the purposes of circulation. Assume the withdrawn coins have fallen by Y—representing some unit of weight—below their standard weight. (5) The industrial capitalists engaged in the production of gold bullion have to produce Y amount of gold bullion to bring the quantity of full-weight gold coins back up to level necessary for circulation. They have to produce an additional amount to replace the gold that vanishes through wear and tear in its non-monetary uses in the course of a year.

Since we are dealing with simple reproduction, we assume the economy doesn’t change but simply keeps reproducing itself. Therefore, the amount of gold produced annually for both monetary and non-monetary purposes remains unchanged from year to year.

However, elsewhere Marx makes a distinction between money as such—bullion—and currency. Currency represents money—gold bullion—in the sphere of circulation. Even full-weight gold coins become representatives of money material in circulation. If a one-ounce gold coin turns over a hundred times during a year, it will represent not one ounce of gold during the year but 100 ounces of gold. This is why gold coins can be replaced by tokens made of materials of nominal value, such as coins made of cheap base metals, or paper and ink.

It is far cheaper—in terms of the total labor measured in terms of time available to society—to make the representatives of gold out of materials of little value such as paper and ink rather than gold itself. This is why in the course of time, gold coins have vanished from circulation in all capitalistically developed nations. (6)

Indeed, if Marx had assumed a paper money system in dealing with simple reproduction, no gold needed for monetary purposes on an annual basis to replace the gold lost through wear and tear of the coinage would have to be produced at all.

However, this is not true in expanded reproduction. Even if no gold is used to actually purchase commodities and make payments, the amount of gold bullion must be increased if interest is not to end up absorbing the profit of enterprise. In other words, if no gold is produced—or even if insufficient gold is produced—it is only a matter of time before the incentive to produce surplus value will vanish.

Since capitalism can only exist as a system of expanded reproduction, even if gold disappears completely from the sphere of circulation the gold industry as the producer of money material would be an absolutely necessary industry even if gold had no non-monetary use values whatsoever. Popularizations of capitalist expanded reproduction that leave out the question of the production of money material—gold bullion—are leaving out a vital feature of capitalist production. This is why attempts to explain periodic capitalist crises on the basis of models of expanded capitalist reproduction that abstract the production of money material are doomed from the start.

Money in its pure form is gold bullion—or the bullion form of whatever precious metal is used as money material—whose quantity must be measured in some unit of weight. Gold bullion is physically homogeneous down to the atomic level and thereby approaches the homogeneous nature of abstract human labor, which forms the social substance of value. Under capitalist production, the value of a commodity can never be measured directly in terms of hours of abstract human labor but must take the form of exchange value. This makes possible the regulatory mechanism of the law of value.

The exchange value of a commodity is always measured in the use value of another commodity. Economically real prices are therefore weights of gold bullion, assuming gold functions as money, even if the gold is not physically present. When gold is not physically present but merely ideal, gold is functioning as money of account. Not only commodities but profit, both interest and profit of enterprise, as well as rent are also measured in terms of weights of gold bullion, though again the gold need not be physical present. Here, too, gold functions as unit of account.

The quantity of capital itself, just like the exchange value of commodities and the mass of profit and rent, is always measured in terms of money—gold bullion. (7) When we refer to a person who is a capitalist, we often ask exactly how much “money” the person is “worth.” For example, we say that so and so is worth a hundred million dollars. Members of capitalist families will often refer to their families’ capital as “the money.”

Yet most capital does not consist of money. But all capital is always measured in terms of money, though capital’s ultimate social substance is value—abstract human labor. However, just like the value of a commodity cannot except in a purely theoretical way be measured directly in terms of hours of abstract human labor but must take the form of exchange value—the value of the commodity being measured in terms of the use value of another commodity—so a quantity of capital itself must be measured in terms of the use value of the money commodity—a given weight of gold.

Some statistics on the uses of gold today

So much for theory. In order to answer the question of what percentage of the world’s gold supply functions as money and what percentage consists of non-monetary use values, we have to look at some real-world statistics that are kindly provided to us by the World Gold Council, the chief trade group of the gold mining and refining industries.

In the year 2008, according to the World Gold Council, the total supply of aboveground gold amounted to some 163,000 tons. Though we can be sure that members of the World Gold Council are not Marxists—they are ruthless industrial capitalists—they do make the distinction between the “aboveground gold”—gold that has absorbed human labor—and the gold that remains in the earth’s crust.

Gold that has not been either mined or refined and remains in its natural state is neither a commodity in general nor money in particular. Such gold, rather, belongs to the category of land, not money or capital. In dealing with gold as a commodity, we are only interested in the gold that has absorbed human labor. In its own way, the World Gold Council makes the same distinction.

Also, like Marx, the World Gold Council measures the quantity of gold as a material use value in units of weight—tons in this case.

How much of this 163,000 tons of the aboveground gold that existed in 2008 functioned as “monetary gold” and how much was used for other purposes? According to the World Gold Council, some 29,700 tons belonged to the “official sector,” which in 2008 came to 18 percent of the total world gold supply. That is, 18 percent of the total world gold supply in 2008 was sitting in the vaults of central banks, government treasuries, or the International Monetary Fund. Most of the world’s gold reserves are owned by the U.S. Treasury, the European central banks, and the U.S.-controlled IMF. This gold, along with legal tender bullion coins, is the only official monetary gold in the world today.

Another 17 percent, some 27,300 tons, was according to the figures provided by the World Gold Council used for “investment” purposes. This clearly represents hoarded gold held mostly by wealthy capitalists.

Economically real profits, including interest, and rents are measured in terms of weights of gold bullion. However, hoarded gold does not grow, it simply sits in its hoard neither shrinking nor growing in weight. Therefore, by definition the capitalists who are holding gold as an “investment” are not seeking to make a profit M’ minus M but rather are simply ensuring the value of a portion of their existing capital by freezing it in its pure money form—gold bullion, or M. Therefore, all gold held as an investment represents money hoarded in the collective “mattress” of the capitalist class and by definition cannot yield any economically real profit, interest or rent.

Gold bars and bullion coins

Gold held as an “investment” is either held in the form of gold bars—classic bullion—or so-called bullion coins. Bullion coins are coins with face values—or mint prices—well below the paper money market price of the gold bullion they physically contain. For example, the U.S. $50 gold coin—official legal tender currency—contains one troy ounce of gold—that is, one troy once of gold bullion. Legally, it can be used to discharge any $50 debt, just like the legal tender $50 Federal Reserve Notes made of mere paper and ink. There is no chance $50 gold coins will be used as currency, however, when the the dollar price of an ounce of gold bullion is hovering around $1,100 on the open market!

Therefore, about 35 percent of the world’s gold supply is clearly used for monetary purposes, used to form hoards that are either in the hands of the state power or in the hands of private hoarders. But that still comes to considerably less than half of the world’s total gold supply.

Gold as an industrial raw material

How much gold is used for clearly non-monetary purposes, what the World Gold Council calls “industrial” purposes? For example, gold used in electronic circuits? According to the World Gold Council, 19,700 tons of gold were used for industrial purposes in 2008. That came to 12 percent of the total aboveground gold supply.

Gold is an excellent conductor of electricity. And unlike silver—which is an even better conductor—gold does not corrode. (8) Gold would be used a lot more in electronics if it was cheaper—that is, if it had a far lower labor value. The high labor value of gold, which makes it an excellent money material—it contains a great amount value in a small mass—is an obstacle to its use in electronics and for many other potential uses.

Jewelry

The biggest single use for gold in 2008, according to the World Gold Council, was its use in jewelry. Some 83,600 tons, or 51 percent of the world’s aboveground gold supply in 2008 was accounted for in this way. Is this monetary gold or non-monetary gold?

Gold is a highly malleable metal. Indeed, when it was used for circulating coins—actual currency—it had to be combined with other metals in small amounts, since coins made up of pure gold are too soft for use as currency—though they can be used as bullion coins that are not meant to circulate. Gold is therefore widely used in jewelry along with precious stones, platinum and silver. While platinum is even more valuable than gold, it tarnishes. which makes it less desirable as money material. For this reason, gold rather than platinum serves as the main money commodity.

When gold bullion is shaped into jewelry, it gains an additional value on top of the value of the bullion, since additional labor is needed to transform gold bullion as raw material into a piece of jewelry—for example, a gold ring. If the ring is later melted down and transformed back into bullion, it loses that extra value. But relatively little additional abstract human labor is needed to transform gold bullion into jewelry compared to the labor needed to produce the gold bullion—the raw material for jewelry—in the first place. (9)

Use values of gold jewelry

Jewelry can be very beautiful. Indeed, even before gold bullion was used as money material, it was used in art. And I think we can safely say that gold will be used in art long after it ceases to be used as money material. To the extent that jewelry is used for its beauty as an art form, its use value is non-monetary. Gold jewelry such as gold rings perform certain social functions—for example, a gold ring is traditionally presented by a man to a woman when a proposal of marriage is made. It can also be be used as a means of flaunting wealth. All these represent non-monetary uses of the gold that is physically contained within gold jewelry.

Jewelry, therefore, is not gold bullion. Even if it is not combined with other valuable commodities such as diamonds or rubies, it is made up of gold bullion that has absorbed additional human labor beyond the labor socially necessary to produce the gold bullion. On average, the price of the gold ring will be the weight of the gold bullion the ring contains plus the additional amount of gold bullion that measures the abstract human labor that the gold absorbed when it was fashioned into a ring.

However, gold jewelry, because it physically contains gold bullion as part as the material use value, can also be used as a means of savings or hoarding. Indeed, in societies that at least until recently lacked modern banking systems, such as India, China and much of the Arab world, gold jewelry was and often still remains the traditional medium of saving.

The price of a piece of gold jewelry—the amount of pure gold bullion that it exchanges for on the market—can never fall very far below the amount of gold bullion that is physically contained in the jewelry. This is because it doesn’t take much labor to transform a piece of gold jewelry, or a gold coin for that matter—indeed gold coins are sometimes used as jewelry—back into pure gold bullion.

Therefore, unlike most non-money commodities, gold jewelry contains within its material use value the gold bullion that can be used as a means of building hoards—a monetary function. Insomuch as the gold bullion that is physically contained within the jewelry is used as a means of saving—hoarding—it is performing a monetary role. Therefore, of the 51 percent in 2008 that was functioning as jewelry, it is a safe bet that a considerable amount was serving as a medium of hoarding—performing a monetary role.

Some further observations

Gold is, however, also used for completely non-monetary purposes. For example, if there is any gold in the motherboard of the computer that I am writing this reply with, it is not being used for purposes of saving—building up a hoard. Unlike gold jewelry, computers rapidly lose their exchange values due to the continuous increase in the processing power of new computers of a given price. As a result, a computer is just about the worst way to hoard wealth imaginable. But even here it is possible to extract the “scrap” gold from an old motherboard and transform it back into bullion where it can either serve as an industrial raw material once again—or function as a means of hoarding—money.

An economic law that limits the amount of gold that can be used for non-monetary purposes

In the main posts, I explained that the rate of interest moves toward a level where the supply and demand for monetary gold is equalized, just like ordinary commodity prices move toward a level where the supply and demand for the particular commodity equate. Indeed, the vulgar bourgeois economist defines the rate of interest as the “price of money,” or as the “value of money.” The long-term rate of interest is frequently referred to by (bourgeois) economists as the “cost” or “price” of capital.

Suppose a crisis of overproduction causes the price of a gold ring to fall below its value. How far can the price of the gold ring fall below its labor value? There is a limit to how far the price can fall that does not apply to commodities that don’t contain gold as part of their material use values. The price of a gold ring cannot fall far below the value of the bullion that is contained in its physical substance. If the price of the gold ring falls significantly below the value of the gold bullion that is contained within it, the ring can always be sent back to the melting pot and be transformed into bullion.

Indeed, during crises this tends to happen. As a result of a crisis, incomes—wages, profits and rents—fall causing the demand for gold rings as objects of beauty or of flaunting wealth, for example, to drop. Perhaps the price of the gold ring will fall below its bullion value. But as soon as this happens, our gold ring is in danger of being sent to the melting pot. As more and more gold rings are sent to the melting pot, the quantity of gold rings will decline. This will cause the price measured in terms of gold bullion to rise once again towards at least the amount of gold bullion physically contained within.

Indeed, because it so trivially easy to melt gold rings and other forms of gold jewelry back into bullion, this operation need not always actually be carried out. The gold bullion can be allowed to simply remain in the jewelry without going to the bother of extracting it by sending gold jewelry to the melting pot. This is why gold jewelry is so widely used as a medium of savings in countries that lack modern banking systems and/or reliable currencies.

Since the final collapse of the international gold standard between 1968 and 1971, the currencies of the imperialist countries themselves have become unreliable, especially during periods of crisis. This is where the nice folks at “Cash for Gold” come in.

During periods of prosperity, the price of gold jewelry in terms of gold bullion is likely to rise relative to the bullion that the piece of gold jewelry physically contains. As a result, a certain amount of gold bullion that previously functioned as gold rings might indeed again be shaped back into rings by jewelers or jewelry manufacturers.

As the demand for gold as a raw material used for the production of commodities not used for monetary purposes rises, the less gold will be available for monetary purposes. Everything else remaining equal—ignoring the continued production of additional gold bullion—the fall in the total amount of monetary gold will cause interest rates to rise. Or what comes to the same thing, more of the profit will now consist of interest and less will consist of profit of enterprise.

A rise in the demand for gold for non-monetary purposes will therefore, everything else remaining equal, reduce the profit of enterprise, which alone provides the incentive to the capitalist to actually produce surplus value.

Therefore, once the capitalist system has fully developed, any rise in the non-monetary demand for gold—assuming gold is the money commodity—the higher the rate of interest and therefore the lower the profit of enterprise will be. Any sharp rise in the non-monetary uses for gold—assuming gold was not in the process of being replaced as the chief monetary commodity—would therefore raise interest rates sharply and cause the profit of enterprise to fall to zero or even negative numbers. In this way, non-monetary commodities that contain large amounts of gold can be overproduced and contribute to the development of a generalized overproduction of commodities.

The resulting overproduction crisis will lead to a rise in the demand for monetary gold. The premium that jewelry demands over pure gold bullion—money—would fall or perhaps disappear as the demand for gold as money—bullion—soars. Gold jewelry will be increasingly melted down and transformed back into bullion. And more and more gold “scrap” will be “mined” from old computer motherboards.

Therefore, an economic law exists that ensures that the great bulk of the world’s gold supply is used for monetary purposes, whether in the form of central bank and government reserves, “investment,” or in jewelry that is used as means of saving—hoarding.

This is exactly what we saw in the 1970s and what we see again today. Indeed, it is hard to watch television for more than a few minutes before an advertisement comes on offering “cash for gold.” Similar ads flourished during the 1970s but were absent during the “Great Moderation” that followed the “Volcker shock.” Remember, the Volcker shock restored the confidence of the capitalists in paper currency and thus reduced the demand for gold as money material releasing it for non-monetary uses.

While the “Cash for Gold” ads are extremely annoying—at least I think so—they do remind us that even if some economic indicators have risen over the last few months—overall the world capitalist system remains in a state of long-term crisis that is likely to assume an acute form once again in the not-too-distant future.

So when you see a “Cash for Gold” ad on TV, in the print media or on the Internet, don’t be annoyed, organize!

————

1 I say political economy rather than bourgeois political economy, because all political economy is bourgeois. The various schools of political economy, from the classical school to the marginalists, all assume that the capitalist system is the the absolute final form of human society. Marx put his work outside the framework of political economy, showing that capitalist production is merely a stage in the history of production This is why he called it the critique of political economy.

2 This shows itself when the various popularizers of Marx explain that money today is no longer a commodity in itself but merely reflects the value of the commodities it circulates. The vast majority of popularizers of Marxist theory—especially since the end of the international gold standard—have fallen into this trap.

This a grave error. On a purely theoretical level, it shows that the popularizer have not fully mastered Marx’s value theory, which is the foundation upon which Marx’s entire critique of political economy is based. It therefore blocks the road to a full understanding of Marx’s discoveries in economic science. It especially shows itself in the sphere of crisis theory and prevents understanding the prospects, or rather lack of prospects, of ending or at least controlling crises within the framework of the capitalist mode of production.

Any concept of “non-commodity” money opens the door to Say’s Law or at least to Keynes. If there is too much demand for money as opposed to commodities, why can’t the “monetary authorities” create all the demand that is needed up to the point of “full employment” through the creation of whatever amount of “non-commodity” money is necessary?

The door is therefore opened to Keynesian-inspired reformism in the guise of Marxism. While the problem of producing surplus value is more or less understood, the problem of realizing surplus value is seen as a mere technical problem that can be corrected by proper government policies. Or, as is often argued by “underconsumptionists,” if only the capitalists would settle for a more “reasonable” rate of surplus value, the problems they encounter in realizing surplus value could be eased if not overcome completely.

This, in turn, leads to the belief that there are common interests between the capitalists and workers in maintaining the buying power of the working class. And this leads to unrealistic expectations about the policies of certain capitalist parties and politicians. We see this today in the bitter disappointment “progressives” are expressing in the policies of the U.S. Democratic Obama administration as they have unfolded over the past year.

Or the opposite mistake is made, in which it is assumed that the only way out of the crisis must be through a rise in the rate of surplus value. This apparently “left” position can also be used to support non-struggle abstentionist policies in the workers’ movement. What’s the point of struggling against capitalist exploitation if it will only make the crisis worse?

3 Ambitious readers will want to go back to the bourgeois classical economists themselves to see how the concept of labor value emerged and evolved in the womb of classical political economy. The most ambitious readers will want to compare first hand the evolution of the concept of labor value by the bourgeois economists, the contradictions of the classical theory of labor value that progressively accumulated, and the resolutions of these contradictions by the marginalists on one side, who negated the concept of labor value entirely, and Marx on the other.

4 Back in the days when gold coins widely functioned as currency, it was important that coins that fell below a certain weight, either due to wear and tear or “clipping,” were withdrawn from circulation and melted down once again into bullion if the devaluation of the currency and the resulting inflation was to be avoided. If underweight coins were not withdrawn from circulation, “light” coins would sooner or later drive the full-weight coins out of circulation. Or as it was said, “bad money drives out good money.”

A debtor given the choice of paying in a heavy coin that contains a greater amount of bullion—real money—or a light coin containing less real money—would always choose to pay in the light coin. The result would be a devaluation of the currency, which would show itself in the rise of the market price of gold bullion in terms of the now devalued gold coins.

5 Remember, gold is always measured in terms of some unit of weight—tons, ounces, grams and so forth.

6 Gold in various forms continues to function as currency in many unstable regions of the globe. A sufficiently severe crisis—for example, a hyper-inflationary collapse of the dollar standard—might well bring gold back into circulation in even the imperialist countries. Gold bullion is therefore the “coin”—currency—of last resort.

7 The marginalists get into trouble on this point. They define the three factors of production as land, labor and capital. But capital consists of many different types of material use values. Instead of three factors of production, shouldn’t each type of material use value that is utilized in production be considered a separate “factor of production”?

Marx avoided this problem through his concept of labor value. Capital consists of commodities and is measured in terms of abstract human labor—a homogeneous social substance—which is measured in terms of some unit of time. This value, however, must manifest itself as exchange value, which is measured in terms of money—a quantity of the physically homogeneous substance gold bullion measured in terms of some unit of weight—since weight is the unit of measure of gold bullion as a material use value.

8 Silver, of course, was at least until the late 19th century also widely used as a money commodity. One of gold’s advantages over silver as money material was not only its greater value but its resistance to tarnishing. Platinum has an even greater value per unit of weight than gold. However, unlike gold, platinum does tarnish, which explains why platinum, at least up to now, has not widely replaced gold in its role as money material.

9 The labor needed to shape gold bullion into jewelry is by no means trivial, however. It is highly skilled labor. Indeed, traditionally in explanations by Marxists of the difference between simple and complex labor, the the labor of a jeweler was used as an example of the complex labor of a skilled worker.

Have you elaborated anywhere why you put So much weight (hehe) on gold in your reasoning? To me, it seems kind of quaint, now that there is no gold standard and currencies are accepted solely on the basis of the trust others put in the sovereign state issuing them. But this might be because I have not read some crucial point earlier in your reasoming.

Sam has indeed elaborated on why he “put[s] so much weight … on gold in [his] reasoning.” He has explained why gold bullion continues to function as real money in today’s capitalist economy in many of his posts and his replies to readers. In particular, you might read his reply to another reader who had similar questions: “A Reply to ‘Anonymous’ on Gold’s Monetary Role Today.”

“Gold Bullion, Jewelry, and the Monetary and Non-Monetary Uses of Gold | A Critique of Crisis Theory” was
in fact a wonderful blog post. In case it possessed a
lot more photos it would probably be quite possibly even better.
Take care -Edna

Of course, gold can have its “monetary uses”, but any commodity can, be it sheep, salt, oil, cocaine or Coca-Cola. That doesn’t mean Coca-Cola is money and the amount of valueless fiat currency issued in the world is somehow determined by any one of these commodities alone.

I understand the horror one might experience at the thought that since money was abolished (in their Marxist definition anyway), the law of value has ceased to be the guiding force of the global economy. But hey, wasn’t that exactly what Marx predicted? Sure, he thought that would mean the inevitable advent of communism… But that part of prediction, apparently, was an error, and we have to deal with it.